[WASHINGTON, D.C.] - U.S. Senator Dick Durbin (D-IL) today released the following statement after the consumer group U.S. PIRG published a report describing troubling aspects of partnerships that colleges have formed with financial institutions to provide students with federal student aid disbursements via debit cards that carry significant fees. The report also discussed efforts by colleges and financial institutions to provide students with campus checking accounts and campus identification cards that are linked to fee-laden debit cards. A copy of the report is available on U.S. PIRG’s website.
“Students, parents and taxpayers should be outraged by unreasonable fees and sweetheart deals involving campus debit cards. When a financial institution charges debit card fees – some as high as $50 – for students to access their federal student aid money, the institution is taking away taxpayer-subsidized funding that should be helping students pay for their education,” said Durbin.
“Once again, Wall Street has found a way to line its pockets while leaving consumers – in this case students – holding the bag. And, these financial institutions have found a partner in the colleges and universities that parents and students trust to give them the information they need to make the best financial decisions. It’s time for schools to reexamine the costs associated with campus debit cards and ensure that students are given clear and transparent choices. I will be working in Washington to put an end to the unreasonable practices highlighted in this report and to protect taxpayer investment.”
Since last year, Durbin has been advocating for increased transparency in debit card practices by urging members of the banking community to adopt a simple, easy-to-read fee disclosure form, similar to one designed by the Pew Charitable Trusts. The form provides bank customers with clear information about fees associated with their bank accounts, allowing them to make the best financial decisions for themselves. To date, Chicagoland’s Inland Bank and the University of Illinois Employee’s Credit Union are the only two Illinois financial institutions to adopt the disclosure form. Chase, the largest bank operating in Illinois and one of the largest banks in the country, has also agreed to use the form.